Cryptocurrencies have entered politics for good, as more and more countries employ the unique features of crypto assets to defy the external political limitations to the free flow of capital. The list of such countries grows; now it includes Russia, Iran, and Venezuela.
Sanctions have been a trusted tool in the U.S. trade war arsenal, but now their power may be not so absolute. Politically hostile counties like Russia and Iran are beginning to understand the importance of undermining dollar as a global centralized currency. In this respect, these countries’ views align perfectly with the position of the crypto community. Now, let’s examine each country one by one.
With the coming of Trump, the Iranian economy has continued to suffer, as even more sanctions were imposed on the already struggling country. According to the announcement by Iran’s Central Bank, Iran is preparing to use cryptocurrencies for daily transactions. If things go according to the plan of Parliamentary Commission for Economic Affairs of Iran, the country’s dependence on US dollar and on SWIFT transaction system will be eliminated.
Mohammad Reza Purebrahimi, an official of Central Bank of Iran, commented:
“This is one of the good ways to bypass the use of the dollar, as well as the replacement of the SWIFT system. We obliged the Central Bank in Iran to start developing proposals on the use of crypto-currency.”
He stated that Russia has confirmed its support for Iranian cryptocurrency initiative.
Russia has been living under sanctions for several years now. The sanctions were imposed by the United States and the European Union, the pretext of which was alleged Russian involvement in the armed conflict in Ukraine. Just like Iran, Russia is working to end its dependence on SWIFT. Moreover, Cryptoruble is going to be launched in the second quarter of 2019. Rumors have it that Russia is also involved in Venezuelan state cryptocurrency Petro.
Despite having a wealth of oil, the Venezuelan economy is collapsing. The country’s currency is worth next to nothing, thanks to horrible inflation rate. The hopeless situation led Venezuelan President Nicolas Maduro to issue state-owned digital currency Petro, which supposed to be backed by oil (but many experts doubt that).
President Trump, however, decided to stay on top of the situation, issuing crypto-sanctions banning U.S. citizens from buying Petro. The Petro project will certainly be a failure, mostly due to terribly inefficient centralized economy of Venezuela. However, the idea state of cryptocurrencies seems to be contagious, and more stable countries like Turkey or Iran could very well succeed in their pursuits.